The World Is Flat And Other Myths

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The World Is FlatAnd Other Myths

• John Horsley
• Executive Director
• American Association of State Highway
• And Transportation Officials

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Myth 1 The World is Flat

• Disproved by Christopher Columbus, 1492

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Myth 2 Transportation Makes You Fat

• STPP Report People who live in counties marked
  by sprawl-style development are more likely to
  be obese.
• Transportation Research Board the evidence falls
  short

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Myth 3 Elvis Is Dead

• Not according to psychiatrist Dr. Donald Hinton
  of Kansas City, who claims hes been treating
  Elviss medical problems for the last five years.

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The Dangerous Myths

• Substitution States are diverting their own
  highway money to other programs, and substituting
  federal transportation dollars -- GAO
• Because of increasing fuel efficiency the gas tax
  is no longer viable

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Growth in Highway Capital Investment

• 1982-2002
• State and Local Federal
• 150 Percent 100 percent

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GAO Report Conclusions

• Between 1998-2002, rate of growth at federal
  level exceeded growth at state level
• Federal Percentage of Highway Capital Investment
• 1980 58 percent
• 1998 37 percent
• 2002 45 percent

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NASBO States Are Back!

• 2002-2004 Recovering from worst fiscal picture
  in decades
• Capital spending on transportation increased by
  5.9 percent in 2004, compared to 1.5 percent
  decrease in 2003.

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Lettings Are Ramping Up 2002
2004 millions

• Texas 3,000 4,500
• Ohio 1,100 1,300
• Washington 250 390
• Missouri 550 1,000

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2004 Popular Vote Backs Transportation

• 55 ballot questions nationwide
• 42 approved
• 76 percent approved

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Myth The Federal Gas Tax Is No Longer A Viable
Revenue Source Because of Increasing Fuel
Efficiency
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Fact Fuel Economy Has Declined, Not
IncreasedEPA Report, 2004

• 1987 22.1 miles per gallon
• 2004 20.8 miles per gallon
• SUVs, Light Trucks 50 of Fleet

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CBO Projects 3.3 Percent Annual Increase in Gas
Tax Revenue
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Market Share of Alternative FuelsHydrogen,
Electric, CNG2020 .02 Percent

• Market Share of Hybrid VehiclesToyota Prius,
  Honda Civic
• 2004 .01 Percent
• 2010 3 Percent
• 2020 15 Percent

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Highway Trust Fund RevenueLosses Due to Fuel
Efficiency and Alternative Fuels

• 2010 1 Percent
• 2025-2035 15-25 Percent

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Real Challenges Facing Federal Fuel Tax Revenue

• 30 Percent Loss in Purchasing Power By 2010 Due
  to Inflation

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Gas Tax HistoryFederal Gasoline Tax Rate in Real
2004 Dollars
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The World Really Is Flat

• Massive construction in China and India
• Globalization has leveled the playing field
• Technology will make other economies dominant

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The World Really Is Flat

• U.S. cant stand still and maintain our economic
  lead
• Myths are a cover for not raising the gas tax
• How to sustain the Highway Trust Fund is part of
  larger debate on how to sustain the U.S. global
  competitiveness

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"Now, here, you see, it takes all the running you
can do, to keep in the same place. If you want to
get somewhere else, you must run at least twice
as fast as that!" Lewis Carroll